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Weekly Review: Home Field Doesn't Guarantee Microsoft Victory By Phil Wainewright November 26, 2002 Despite the best efforts of Sun, Oracle and others to shift the strategic center of Internet computing to the heart of the network, it is becoming increasingly clear that the real battleground for control of the next generation of computing will take place at the periphery — which of course is the home turf of their arch-rival Microsoft. Back in the 1990s, when people first started thinking about the notion of network computing, it seemed reasonable to assume that it meant consolidating all the computing power in massive data centers buried deep within the network, in much the same way that electricity generation is centered on huge power stations. Read and React "The same demand for choice and flexibility that led to the rejection of being tied to a specific network server also limits the potential to fence users in with a proprietary client environment. In the end, the network will enforce competition on Microsoft far more effectively than the long court battles fought by the U.S. Department of Justice." Give us your feedback in the ASPnews Discussion Forum The corollary was that there would no longer be any need to leave computing power at the periphery, and that expensive and unwieldy Windows PCs would gradually be replaced by slim, cheap network computers running lean, low-cost alternatives to Windows. It is easy to see why the likes of Scott McNealy of Sun and Larry Ellison at Oracle found this vision so alluring, with its implication that the Microsoft-dominated desktop PC market would simply shrivel away, reducing Bill Gates' company to the status of an impoverished also-ran. Web Services Standards Change Game Plan Now that XML and related Web services standards such as SOAP are beginning to bring the vision closer to reality, we are beginning to discover the flaw in those early assumptions. It turns out that network computing is even less hierarchical than the previous client-server generation. Instead of being sucked into the center, computing is distributed more evenly throughout the network, and it makes much more sense for peripheral devices to connect to multiple resources on demand rather than tying them to a single controlling master resource. Although it still makes sense to locate infrastructure management on network-centric servers — in what IBM and others like to call the grid — the only sensible place to leave control of the applications is at the periphery, where the users are. After all, it's the users who, at the end of the day, call the shots. Denying them choice or performance simply to make the job of running the network easier is not an argument they're likely to buy into for long. Just as, in the retail business, the saying goes that "The customer is king," so on the network, it is the client who rules the roost. The fruits of this realization are now starting to take shape in the evolution of new client-centric capabilities that harness the power of the network to expand user choice and control. But surprizingly, The implications are not all to Microsoft's advantage. Although the strategic battleground has shifted to its home territory, that won't automatically hand the victory to the maker of Windows. Home Turf Doesn't Guarantee Victory The same demand for choice and flexibility that led to the rejection of being tied to a specific network server also limits the potential to fence users in with a proprietary client environment. In the end, the network will enforce competition on Microsoft far more effectively than the long court battles fought by the U.S. Department of Justice. One example is the use of XML and SOAP to exchange data between network-based applications and Microsoft Office. Online customer relationship management (CRM) provider UpShot was one of the first to use XML to integrate its online services with Office applications such as Excel and Word. Its most recent coup is the introduction of integration with Outlook e-mail (see Upshot Ties CRM to Microsoft Outlook E-mail). Although at first glance, this might seem to be good for Microsoft, since it reinforces use of its Office suite, in reality it undermines the company's control over its own proprietary environment. UpShot customers, for example, can use the integrated e-mail and CRM capabilities without having to purchase an Exchange server, thus denying Microsoft additional revenues that it could otherwise look forward to. UpShot has used XML Web services as a Trojan horse to entice customers into storing their data on its own servers rather than on the Microsoft platform. Many other ASPs are now using similar technologies to link their services into Office applications, and Microsoft's own determination to convert the suite to an XML-based file format in its next release will accelerate the trend. No wonder Sun was so keen last week to back the new proposal from standards body OASIS to develop an open standard format for storing office documents in XML (see Microsoft's Battle Lines Shifting to Office?). Once providers have pried their customers' data out of Microsoft Office and onto their own platforms, the substitution of a standards-based Office front end would complete the annihilation of Microsoft's client-side dominance. Windows Under Attack Meanwhile, Windows itself is increasingly under threat from browser-based alternatives that can run on any platform that supports HTTP-based Web access. In the early days of network computing, browser-based functionality was poor and slow compared to Windows, but increasing sophistication now supports a richer Internet client. The release earlier this month by the WorldWide Web Consortium (W3C) of a finished draft of the XForms specification promises to enable much more sophisticated browser-based forms than are currently possible using raw XML or HTML. Macromedia's Flash MX, released earlier this year and compatible with virtually all installed browsers, is another powerful tool for delivering sophisticated client capabilities within the browser. Standardization has already leveled the playing field on the network, forcing vendors to compete like-for-like on implementation rather than fencing customers within proprietary environments. Now that same imperative is forcing Microsoft to give up its proprietary control of the desktop in order to ensure users of its software have the same access to network resources as users of competing platforms. As the dominant incumbent in the desktop market, Microsoft has a tremendous advantage in its massive installed base. But it can no longer take those customers for granted. The advent of network computing may not have worked out quite the way that Scott McNealy and Larry Ellison originally expected, but it looks like it will nevertheless grant their wishes, and force Microsoft to fight for market share on the same terms as everyone else. Do you have a comment or question about this article or the ASP industry in general? Speak out in the ASP Discussion Forum.